Determining Dispatch Instructions

The IESO issues dispatch instructions to each dispatchable facility in Ontario for each five-minute interval of every day, and to boundary entities for each hourly interval of every day. The dispatch instructions specify the required amount of energy that is to be injected or withdrawn for each interval.

As previously discussed, these specified amounts are determined by the facility’s bids or offers:

• In most cases, a generator or importing boundary entity is sent dispatch instructions to inject energy into the IESO-controlled grid whenever the market clearing price for a given interval is equal to or exceeds the price offered by the generator or boundary entity for that interval.
• In most cases, a load or exporting boundary entity is sent dispatch instructions to withdraw energy from the IESO-controlled grid whenever the market clearing price for a given interval is equal to or less than the price bid by the load or boundary entity for that interval.
• Dispatch instructions cannot always follow this formula. If there are physical or security constraints on the lines, dispatch instructions may be different from what we would expect if we just considered bids and offers.

Constraints and Transmission Limitations

For example, the amount of power that can travel along transmission lines can be limited by factors such as weather. In order to preserve the integrity of the power grid, however, the IESO’s dispatch instructions must take the physical limitations of the transmission lines into account. When there are constraints on the lines, actual dispatch instructions may be different from what we would expect, but the market clearing price does not change. However, in order to maintain fairness in the market, generators and loads are paid “constrained-on” and “constrained-off” payments if they are affected by transmission line limitations.